China-Thailand_Trade_Enjoys_Multiple_Dividends_Wit

33
China-Thailand Trade Enjoys Multiple Dividends With the Effect of the RCEP By Andrey Guo
L ocated in the center of Southeast Asia, Thailand is an important hub connecting Asia-Pacific countries that are land locked with Asia-Pacific maritime countries, and plays a pivotal role in the development and prosperity of Southeast Asia.In order to promote the high-quality
development of the Belt and Road Initiative, optimize foreign investment promotion services, and help the stable development of China-Thailand foreign trade, the China Council for the Promotion of International Trade Commercial Legal Service Center (hereinafter CCPITCLSC), the Board of Investment of Thailand, and the Royal Thai Embassy in China jointly hosted a seminar on “Investment Opportunities and Policy Suppor t in T ha i land ”, which at tracted more than 300 representatives of Chinese enterprises from the f ields of electronic information, financial technology and new energy.
China and Thailand have strong complementary industries At present, w ith the pandemic stil l happening, the world’s economic recovery is insufficient, and the external environment is becoming more complicated and uncertain. To this background, in 2021, China’s foreign investment cooperation developed steadily, with the total foreign direct investment of the whole industry reaching RMB 936.69 billion, equivalent to USD 145.19 billion, up 9.2% year on year. Thailand’s strong investment protection measures, convenient investment environment
and preferential investment policies make it an
34important destination for Chinese enterprises to
invest.
“China’s Belt and Road and Thailand’s
Industr y 4.0 strateg y have created a rare
opportunity for China-Thailand economic and
trade cooperation,” Zhang Shun, Deputy Director
of the CCPITCLSC, said in his speech. He
pointed out that these opportunities are manifested
in the acceleration of China-ASEAN economic
integration at the regional level in Southeast Asia,
and in the increasing industrial complementarity
between China and Thailand at the bilateral level.
China-Thailand economic and trade cooperation
has been fully launched in many fields such as
trade, investment, infrastructure construction,
finance and tourism.
In recent years, China-Thailand economic
and trade cooperation has been enriched in
content, expanded in fields and raised in level.
China has been Thailand’s largest trading
partner for nine consecutive years. In 2021,
the trade between the two sides overcame the
impact of the pandemic and exceeded USD 100
billion. Chinese enterprises in e-commerce,
communication, automobile, photovoltaic and
other fields have invested and set up factories
in Thailand, and Thai agricultural products,
rubber and electronic products are welcomed by
the Chinese market.
On January 1st this year, the Regional
Comprehensive Economic Partnership (RCEP)
came into effect for China, Japan, New
Zealand, Australia, and 6 ASEAN member
countries including Singapore, Thailand
and Vietnam. More than 90% of the goods
trade will finally enjoy zero tariffs. Zhang
Shun said that many contents of bilateral
economic and trade cooperation bet ween
China and Thailand are carried out under the
cooperation framework of China-ASEAN
and the RCEP. The improvement of economic
integration between China and Southeast Asia
and the implementation of the RCEP will
greatly promote bilateral economic and trade
cooperation between China and Thailand.
According to the statistics of the General
Administration of Customs of China, in the
first two months of this year, the total import
and export of China and RCEP trading partners
was RMB 1.85 trillion, a year-on-year increase
of 9.5%, showing a strong growth momentum.
Zhang Shun pointed out that under the
RCEP framework, China-Thailand economic
and trade cooperation will certainly reach a
new level. China and Thailand will further
open markets such as fishery products, paper
making and auto parts, and make high-quality
commitments to non-service industries such as
agriculture and manufacture by negative list,
which will attract more Chinese enterprises
to invest and build factories in Thailand.
The RCEP’s institutional arrangements on
e-commerce and intellectual property rights
will further facilitate cross-border e-commerce
and digital economy cooperation between
China and Thailand, promote the f low of
innovative resources between the two countries,
and jointly grasp new opportunities in the
digital age.
“Thailand can be an important gateway
for China to deepen the relationship between
China and ASEAN member countries,” Narit
Therdsteerasukdi, Deputy Secretary General
of the Board of Investment of Thailand,
commented. He said that under the “Bio-
Circular-Green” (BCG) economic model of the
Thai government, Thailand has strong potential
to become a regional center of sustainable
de velopment enter pr is e s, a nd Ch i ne s e
enterprises and technologies will play a key role
in Thailand.
Chiyawan Chongvatana, Commercial
Minister of the Royal Thai Embassy in China,
said that in recent years, the economic and trade
cooperation between China and Thailand has
been stable, and the investment cooperation
between China and Thailand has gradually
formed a multi-level, multi-channel and all-
round cooperation. She believes that the official
entry into force of the RCEP in China and
Thailand will further enhance the confidence
of Chinese and Thai investors. The high-level
free trade environment created by the RCEP
will bring more integration and complementary
ef fe c t s to Ch i n a-T h a i l a nd i nv e s t ment
cooperations.
Introducing a number of preferential
policies
In recent yea rs, the “Tha iland 4.0”
economic development strategy put forward by
Thailand and the construction project of the
Eastern Economic Corridor (EEC) has become
the focus of investors from all over the world.
According to the Bangkok Post on March
2nd, the Thai Cabinet approved the special
incentive measures in seven economic zones
include the EECa (Eastern Airport City),
EECi (Innovation Hub), EECd (Digital Park),
EECmd (Medical Hub), and EECg (Genomics
Thailand), the Eastern Economic Corridor of
High-speed Railway (EECh) and the Digital
and High-tech Center. The Cabinet also allows
the EEC office to provide special policies to
investors in seven regions according to specific
situations to attract investors.
Under this background, in 2021, China’s foreign investment cooperation developed steadily, with the total foreign direct investment of the whole industry reaching 936.69
billion yuan, equivalent to 145.19
billion US dollars, up 9.2% year
on year.
At this seminar, Ansutong Vasu San, Deputy Director of the target industry promotion department of the Eastern Economic Corridor Office, said that the Eastern Economic Corridor program aims to strengthen the eastern coast of Thailand, which has been a regiona l manufacturing and trade center for more than 30 years. He introduced in detail the infrastructure of the eastern economic corridor, the development of the digital economy and the industrial fields that enterprises can focus on.
At present, the business environment in Thailand is optimistic, attracting many foreign companies to invest in Thailand. According to statistics from Thailand, in 2021, among the foreign projects applying for investment promotion in Thailand, China’s project applications ranked second in terms of total value. A total of 112 project applications were submitted to the Board of Investment of Thailand, with a total investment value of THB 38.567 billion (about RMB 7.276 billion), an increase of 25% compared to 2020.
Wantana Tatan, Minister Counselor (Investment Promotion) of the Royal Thai Embassy in China and the Director of the Beijing Office of the Board of Investment of Thailand said that among the projects that Chinese enterprises applied for investment in Thailand, the industry with the highest investment value was the electronics and elect r ica l appl ia nces indust r y, w it h a n investment of THB 18.334 billion; followed by metal products manufacturing and machinery industry, with an investment of THB 9.223 billion; then there is light industry, with an investment of THB 4.923 billion. In terms of the number of projects, the metal products manufact uring industr y and machiner y industry have applied for the largest number of investment projects, with 27 projects.
Wantana Tatan said that in order to attract more investors to invest in Thailand, the Thai government has introduced many preferential policies, such as a tax-free period of up to 13 years, to attract high-tech industries to settle in Thailand, especially in the eastern economic corridor.
Thailand’s investment policy, which provides preferential rights and interests in tax and non-tax, has promoted foreign enterprises’ investment in Thailand to a certain extent. For example, exemption of enterprise income tax, halving of enterprise income tax, exemption of import ta xes on machines, exemption of import taxes on raw materials used for producing export products and R&D, etc. Non-tax preferential rights and interests include
(except for industries specially stipulated by law)
allowing foreign investors to hold large shares
or wholly-owned shares; allow land ownership
for use in investment-promoted projects; allow
foreign executives, experts and their families to
enter Thailand, and allow foreign executives and
experts to work in projects that have received investment promotion; and allowing foreign
currency remittance.
It is understood that the the Board of Investment of Thailand has set the industries
with development potential and conducive to promoting Thailand’s economic development as
target industries, with a total of ten categories,
namely, the transportation industry in the new
era; smart electronics industry; agricultural biotechnology industry; machinery, automation
and robot industry; advanced materials, special chemicals/polymer industries; digital industry; comprehensive medical industry; circular
economy related industries; high value-added services, such as R&D, high-quality tourism, international business centers and human
resources development; and logistics and public
facilities industries.
Wantana Tatan pointed out that projects using
important technologies can also get investment,
namely biotechnology, nanotechnology, digital technology and advanced material technology. Such
projects can get higher-level special preferential
rights than general projects. If the project helps to
enhance Thailand’s national competitiveness, or
is located in a special promotion area, such as
the Eastern Economic Corridor of Thailand,
special economic development zone or industrial
park, additional preferential rights can be obtained.
In addition, the Thai government regards
the “Bio-Circular-Green” (BCG) economic
model as their national development concept.
Thailand is rich in biodiversity and agricultural products. The purpose of adopting BCG
economic model is to give full play to these advantages and make full use of resources,
to maintain the safety of raw materials and a
balance of the ecological environment.
Wantana Tatan suggested: “Chinese enterprises have great potential for technological
and innovative development in the above target industries, and the Thai government also has
special support policies for these industries. Therefore, Chinese and Thai investors can
take this opportunity to cooperate with each
other, jointly develop and invest in the above-mentioned target industries in Thailand, and
use Thailand as a base connecting the ASEAN
market and the world market.”
A total of
112 project
applications
were
submitted to
the Board of
Investment
of Thailand,
with a total
investment of
38.567
billion baht
(about RMB
7.276
billion), an
increase
of 25%
compared
with
2020.
35。